x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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23-1274455
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(State or Other Jurisdiction of Incorporation or Organization)
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|
(I.R.S. Employer Identification No.)
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|
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7201 Hamilton Boulevard, Allentown, Pennsylvania
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18195-1501
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(Address of Principal Executive Offices)
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(Zip Code)
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Large accelerated
filer x
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Accelerated
filer ¨
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Non-accelerated
filer ¨
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|
Smaller reporting
company ¨
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Emerging
growth company ¨
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Class
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|
Outstanding at 31 December 2018
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Common Stock, $1 par value
|
|
219,631,171
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
•
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changes in global or regional economic conditions, supply and demand dynamics in the market segments we serve, or in the financial markets;
|
•
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risks associated with having extensive international operations, including political risks, risks associated with unanticipated government actions and risks of investing in developing markets;
|
•
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project delays, contract terminations, customer cancellations, or postponement of projects and sales;
|
•
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the future financial and operating performance of major customers and joint venture partners;
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•
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our ability to develop, implement, and operate new technologies, or to execute the projects in our backlog;
|
•
|
tariffs, economic sanctions and regulatory activities in jurisdictions in which we and our affiliates and joint ventures operate;
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•
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the impact of environmental, tax or other legislation, as well as regulations affecting our business and related compliance requirements, including regulations related to global climate change;
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•
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changes in tax rates and other changes in tax law;
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•
|
the timing, impact, and other uncertainties relating to acquisitions and divestitures, including our ability to integrate acquisitions and separate divested businesses, respectively;
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•
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risks relating to cybersecurity incidents, including risks from the interruption, failure or compromise of our information systems;
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•
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catastrophic events, such as natural disasters, acts of war, or terrorism;
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•
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the impact of price fluctuations in natural gas and disruptions in markets and the economy due to oil price volatility;
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•
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costs and outcomes of legal or regulatory proceedings and investigations;
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•
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asset impairments due to economic conditions or specific events;
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•
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significant fluctuations in interest rates and foreign currency exchange rates from those currently anticipated;
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•
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damage to facilities, pipelines or delivery systems, including those we own or operate for third parties;
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•
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availability and cost of raw materials; and
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•
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the success of productivity and operational improvement programs
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Three Months Ended
|
|||||
|
31 December
|
|||||
(Millions of dollars, except for share and per share data)
|
2018
|
2017
|
||||
Sales
|
|
$2,224.0
|
|
|
$2,216.6
|
|
Cost of sales
|
1,544.0
|
|
1,571.8
|
|
||
Facility closure
|
29.0
|
|
—
|
|
||
Selling and administrative
|
189.6
|
|
191.6
|
|
||
Research and development
|
15.0
|
|
14.6
|
|
||
Other income (expense), net
|
8.6
|
|
22.1
|
|
||
Operating Income
|
455.0
|
|
460.7
|
|
||
Equity affiliates' income
|
52.9
|
|
13.8
|
|
||
Interest expense
|
37.3
|
|
29.8
|
|
||
Other non-operating income (expense), net
|
18.5
|
|
9.8
|
|
||
Income From Continuing Operations Before Taxes
|
489.1
|
|
454.5
|
|
||
Income tax provision
|
132.1
|
|
291.8
|
|
||
Income From Continuing Operations
|
357.0
|
|
162.7
|
|
||
Loss From Discontinued Operations, net of tax
|
—
|
|
(1.0
|
)
|
||
Net Income
|
357.0
|
|
161.7
|
|
||
Net Income Attributable to Noncontrolling Interests of Continuing Operations
|
9.5
|
|
7.1
|
|
||
Net Income Attributable to Air Products
|
|
$347.5
|
|
|
$154.6
|
|
Net Income Attributable to Air Products
|
|
|
||||
Income from continuing operations
|
|
$347.5
|
|
|
$155.6
|
|
Loss from discontinued operations
|
—
|
|
(1.0
|
)
|
||
Net Income Attributable to Air Products
|
|
$347.5
|
|
|
$154.6
|
|
Basic Earnings Per Common Share Attributable to Air Products
|
|
|
||||
Income from continuing operations
|
|
$1.58
|
|
|
$.71
|
|
Loss from discontinued operations
|
—
|
|
—
|
|
||
Net Income Attributable to Air Products
|
|
$1.58
|
|
|
$.71
|
|
Diluted Earnings Per Common Share Attributable to Air Products
|
|
|
||||
Income from continuing operations
|
|
$1.57
|
|
|
$.70
|
|
Loss from discontinued operations
|
—
|
|
—
|
|
||
Net Income Attributable to Air Products
|
|
$1.57
|
|
|
$.70
|
|
Weighted Average Common Shares – Basic (in millions)
|
219.9
|
|
218.9
|
|
||
Weighted Average Common Shares – Diluted (in millions)
|
221.0
|
|
220.4
|
|
|
|
Three Months Ended
|
||||||
|
|
31 December
|
||||||
(Millions of dollars)
|
|
2018
|
|
2017
|
||||
Net Income
|
|
|
$357.0
|
|
|
|
$161.7
|
|
Other Comprehensive Income (Loss), net of tax:
|
|
|
|
|
||||
Translation adjustments, net of tax of $4.9 and ($6.6)
|
|
(68.1
|
)
|
|
136.4
|
|
||
Net loss on derivatives, net of tax of ($0.7) and ($5.3)
|
|
(10.3
|
)
|
|
(9.5
|
)
|
||
Pension and postretirement benefits, net of tax of ($0.8) and $–
|
|
(3.9
|
)
|
|
—
|
|
||
Reclassification adjustments:
|
|
|
|
|
||||
Currency translation adjustment
|
|
—
|
|
|
3.1
|
|
||
Derivatives, net of tax of ($0.8) and $1.7
|
|
(3.1
|
)
|
|
.8
|
|
||
Pension and postretirement benefits, net of tax of $5.0 and $11.0
|
|
15.2
|
|
|
22.9
|
|
||
Total Other Comprehensive Income (Loss)
|
|
(70.2
|
)
|
|
153.7
|
|
||
Comprehensive Income
|
|
286.8
|
|
|
315.4
|
|
||
Net Income Attributable to Noncontrolling Interests
|
|
9.5
|
|
|
7.1
|
|
||
Other Comprehensive Income (Loss) Attributable to Noncontrolling Interests
|
|
(.9
|
)
|
|
1.9
|
|
||
Comprehensive Income Attributable to Air Products
|
|
|
$278.2
|
|
|
|
$306.4
|
|
|
|
|
|
|
|
|
31 December
|
|
30 September
|
||||
(Millions of dollars, except for share and per share data)
|
|
2018
|
|
2018
|
||||
Assets
|
|
|
|
|
||||
Current Assets
|
|
|
|
|
||||
Cash and cash items
|
|
|
$2,923.3
|
|
|
|
$2,791.3
|
|
Short-term investments
|
|
12.3
|
|
|
184.7
|
|
||
Trade receivables, net
|
|
1,268.2
|
|
|
1,207.2
|
|
||
Inventories
|
|
403.4
|
|
|
396.1
|
|
||
Prepaid expenses
|
|
74.9
|
|
|
129.6
|
|
||
Other receivables and current assets
|
|
407.8
|
|
|
373.3
|
|
||
Total Current Assets
|
|
5,089.9
|
|
|
5,082.2
|
|
||
Investment in net assets of and advances to equity affiliates
|
|
1,242.4
|
|
|
1,277.2
|
|
||
Plant and equipment, at cost
|
|
21,586.5
|
|
|
21,490.2
|
|
||
Less: accumulated depreciation
|
|
11,626.7
|
|
|
11,566.5
|
|
||
Plant and equipment, net
|
|
9,959.8
|
|
|
9,923.7
|
|
||
Goodwill, net
|
|
780.4
|
|
|
788.9
|
|
||
Intangible assets, net
|
|
416.9
|
|
|
438.5
|
|
||
Noncurrent capital lease receivables
|
|
985.9
|
|
|
1,013.3
|
|
||
Other noncurrent assets
|
|
666.7
|
|
|
654.5
|
|
||
Total Noncurrent Assets
|
|
14,052.1
|
|
|
14,096.1
|
|
||
Total Assets
|
|
|
$19,142.0
|
|
|
|
$19,178.3
|
|
Liabilities and Equity
|
|
|
|
|
||||
Current Liabilities
|
|
|
|
|
||||
Payables and accrued liabilities
|
|
|
$1,738.3
|
|
|
|
$1,817.8
|
|
Accrued income taxes
|
|
111.9
|
|
|
59.6
|
|
||
Short-term borrowings
|
|
23.0
|
|
|
54.3
|
|
||
Current portion of long-term debt
|
|
430.3
|
|
|
406.6
|
|
||
Total Current Liabilities
|
|
2,303.5
|
|
|
2,338.3
|
|
||
Long-term debt
|
|
2,954.4
|
|
|
2,967.4
|
|
||
Long-term debt – related party
|
|
360.2
|
|
|
384.3
|
|
||
Other noncurrent liabilities
|
|
1,551.6
|
|
|
1,536.9
|
|
||
Deferred income taxes
|
|
768.9
|
|
|
775.1
|
|
||
Total Noncurrent Liabilities
|
|
5,635.1
|
|
|
5,663.7
|
|
||
Total Liabilities
|
|
7,938.6
|
|
|
8,002.0
|
|
||
Commitments and Contingencies - See Note 10
|
|
|
|
|
||||
Air Products Shareholders’ Equity
|
|
|
|
|
||||
Common stock (par value $1 per share; issued 2019 and 2018 - 249,455,584 shares)
|
|
249.4
|
|
|
249.4
|
|
||
Capital in excess of par value
|
|
1,030.4
|
|
|
1,029.3
|
|
||
Retained earnings
|
|
13,497.9
|
|
|
13,409.9
|
|
||
Accumulated other comprehensive loss
|
|
(1,811.2
|
)
|
|
(1,741.9
|
)
|
||
Treasury stock, at cost (2019 - 29,824,413 shares; 2018 - 29,940,339 shares)
|
|
(2,083.6
|
)
|
|
(2,089.2
|
)
|
||
Total Air Products Shareholders’ Equity
|
|
10,882.9
|
|
|
10,857.5
|
|
||
Noncontrolling Interests
|
|
320.5
|
|
|
318.8
|
|
||
Total Equity
|
|
11,203.4
|
|
|
11,176.3
|
|
||
Total Liabilities and Equity
|
|
|
$19,142.0
|
|
|
|
$19,178.3
|
|
|
Three Months Ended
|
|||||
|
31 December
|
|||||
(Millions of dollars)
|
2018
|
2017
|
||||
Operating Activities
|
|
|
||||
Net income
|
|
$357.0
|
|
|
$161.7
|
|
Less: Net income attributable to noncontrolling interests of continuing operations
|
9.5
|
|
7.1
|
|
||
Net income attributable to Air Products
|
347.5
|
|
154.6
|
|
||
Loss from discontinued operations
|
—
|
|
1.0
|
|
||
Income from continuing operations attributable to Air Products
|
347.5
|
|
155.6
|
|
||
Adjustments to reconcile income to cash provided by operating activities:
|
|
|
||||
Depreciation and amortization
|
258.0
|
|
227.9
|
|
||
Deferred income taxes
|
(1.0
|
)
|
(76.7
|
)
|
||
Tax reform repatriation
|
46.2
|
|
310.3
|
|
||
Facility closure
|
29.0
|
|
—
|
|
||
Undistributed losses of unconsolidated affiliates
|
1.0
|
|
29.9
|
|
||
Gain on sale of assets and investments
|
(.7
|
)
|
(.6
|
)
|
||
Share-based compensation
|
9.3
|
|
11.8
|
|
||
Noncurrent capital lease receivables
|
24.8
|
|
23.3
|
|
||
Other adjustments
|
12.7
|
|
5.3
|
|
||
Working capital changes that provided (used) cash, excluding effects of acquisitions:
|
|
|
||||
Trade receivables
|
(73.6
|
)
|
(34.2
|
)
|
||
Inventories
|
(10.4
|
)
|
(8.4
|
)
|
||
Other receivables
|
10.3
|
|
23.8
|
|
||
Payables and accrued liabilities
|
(55.4
|
)
|
(113.5
|
)
|
||
Other working capital
|
57.5
|
|
5.5
|
|
||
Cash Provided by Operating Activities
|
655.2
|
|
560.0
|
|
||
Investing Activities
|
|
|
||||
Additions to plant and equipment
|
(403.4
|
)
|
(256.6
|
)
|
||
Acquisitions, less cash acquired
|
—
|
|
(237.1
|
)
|
||
Proceeds from sale of assets and investments
|
1.1
|
|
10.6
|
|
||
Purchases of investments
|
(5.3
|
)
|
(212.2
|
)
|
||
Proceeds from investments
|
178.0
|
|
208.9
|
|
||
Other investing activities
|
3.1
|
|
5.6
|
|
||
Cash Used for Investing Activities
|
(226.5
|
)
|
(480.8
|
)
|
||
Financing Activities
|
|
|
||||
Payments on long-term debt
|
(2.6
|
)
|
(408.6
|
)
|
||
Net decrease in commercial paper and short-term borrowings
|
(38.0
|
)
|
(40.7
|
)
|
||
Dividends paid to shareholders
|
(241.5
|
)
|
(207.5
|
)
|
||
Proceeds from stock option exercises
|
4.7
|
|
34.4
|
|
||
Other financing activities
|
(12.4
|
)
|
(18.7
|
)
|
||
Cash Used for Financing Activities
|
(289.8
|
)
|
(641.1
|
)
|
||
Discontinued Operations
|
|
|
||||
Cash used for operating activities
|
—
|
|
(3.1
|
)
|
||
Cash provided by investing activities
|
—
|
|
—
|
|
||
Cash provided by financing activities
|
—
|
|
—
|
|
||
Cash Used for Discontinued Operations
|
—
|
|
(3.1
|
)
|
||
Effect of Exchange Rate Changes on Cash
|
(6.9
|
)
|
14.0
|
|
||
Increase (Decrease) in cash and cash items
|
132.0
|
|
(551.0
|
)
|
||
Cash and Cash items – Beginning of Year
|
2,791.3
|
|
3,273.6
|
|
||
Cash and Cash Items – End of Period
|
|
$2,923.3
|
|
|
$2,722.6
|
|
|
Three Months Ended
|
|||||||||||||||||||||||
|
31 December 2018
|
|||||||||||||||||||||||
(Millions of dollars, except for per share data)
|
Common Stock
|
|
Capital in Excess of Par Value
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Air
Products Shareholders' Equity
|
|
Non-
controlling
Interests
|
|
Total
Equity
|
|
||||||||
Balance at 30 September 2018
|
|
$249.4
|
|
|
$1,029.3
|
|
|
$13,409.9
|
|
|
($1,741.9
|
)
|
|
($2,089.2
|
)
|
|
$10,857.5
|
|
|
$318.8
|
|
|
$11,176.3
|
|
Net income
|
—
|
|
—
|
|
347.5
|
|
—
|
|
—
|
|
347.5
|
|
9.5
|
|
357.0
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
—
|
|
(69.3
|
)
|
—
|
|
(69.3
|
)
|
(.9
|
)
|
(70.2
|
)
|
||||||||
Dividends on common stock (per share $1.10)
|
—
|
|
—
|
|
(241.6
|
)
|
—
|
|
—
|
|
(241.6
|
)
|
—
|
|
(241.6
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(6.9
|
)
|
(6.9
|
)
|
||||||||
Share-based compensation
|
—
|
|
8.9
|
|
—
|
|
—
|
|
—
|
|
8.9
|
|
—
|
|
8.9
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
(7.6
|
)
|
—
|
|
—
|
|
5.6
|
|
(2.0
|
)
|
—
|
|
(2.0
|
)
|
||||||||
Cumulative change in accounting principle
|
—
|
|
—
|
|
(17.1
|
)
|
—
|
|
—
|
|
(17.1
|
)
|
—
|
|
(17.1
|
)
|
||||||||
Other equity transactions
|
—
|
|
(.2
|
)
|
(.8
|
)
|
—
|
|
—
|
|
(1.0
|
)
|
—
|
|
(1.0
|
)
|
||||||||
Balance at 31 December 2018
|
|
$249.4
|
|
|
$1,030.4
|
|
|
$13,497.9
|
|
|
($1,811.2
|
)
|
|
($2,083.6
|
)
|
|
$10,882.9
|
|
|
$320.5
|
|
|
$11,203.4
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
Three Months Ended
|
|||||||||||||||||||||||
|
31 December 2017
|
|||||||||||||||||||||||
(Millions of dollars, except for per share data)
|
Common Stock
|
|
Capital in Excess of Par Value
|
|
Retained Earnings
|
|
Accumulated Other Comprehensive Income (Loss)
|
|
Treasury Stock
|
|
Air
Products Shareholders' Equity
|
|
Non-
controlling
Interests
|
|
Total
Equity
|
|
||||||||
Balance at 30 September 2017
|
|
$249.4
|
|
|
$1,001.1
|
|
|
$12,846.6
|
|
|
($1,847.4
|
)
|
|
($2,163.5
|
)
|
|
$10,086.2
|
|
|
$99.3
|
|
|
$10,185.5
|
|
Net income
|
—
|
|
—
|
|
154.6
|
|
—
|
|
—
|
|
154.6
|
|
7.1
|
|
161.7
|
|
||||||||
Other comprehensive income (loss)
|
—
|
|
—
|
|
—
|
|
151.8
|
|
—
|
|
151.8
|
|
1.9
|
|
153.7
|
|
||||||||
Dividends on common stock (per share $0.95)
|
—
|
|
—
|
|
(208.0
|
)
|
—
|
|
—
|
|
(208.0
|
)
|
—
|
|
(208.0
|
)
|
||||||||
Dividends to noncontrolling interests
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(7.7
|
)
|
(7.7
|
)
|
||||||||
Share-based compensation
|
—
|
|
11.1
|
|
—
|
|
—
|
|
—
|
|
11.1
|
|
—
|
|
11.1
|
|
||||||||
Issuance of treasury shares for stock option and award plans
|
—
|
|
(14.7
|
)
|
—
|
|
—
|
|
34.6
|
|
19.9
|
|
—
|
|
19.9
|
|
||||||||
Other equity transactions
|
—
|
|
.6
|
|
(.9
|
)
|
—
|
|
—
|
|
(.3
|
)
|
5.3
|
|
5.0
|
|
||||||||
Balance at 31 December 2017
|
|
$249.4
|
|
|
$998.1
|
|
|
$12,792.3
|
|
|
($1,695.6
|
)
|
|
($2,128.9
|
)
|
|
$10,215.3
|
|
|
$105.9
|
|
|
$10,321.2
|
|
The accompanying notes are an integral part of these statements.
|
1
|
.
|
|
||
2
|
.
|
|
||
3
|
.
|
|
||
4
|
.
|
|
||
5
|
.
|
|
||
6
|
.
|
|
||
7
|
.
|
|
||
8
|
.
|
|
||
9
|
.
|
|
||
10
|
.
|
|
||
11
|
.
|
|
||
12
|
.
|
|
||
13
|
.
|
|
||
14
|
.
|
|
||
15
|
.
|
|
||
16
|
.
|
|
|
Industrial
Gases– Americas |
Industrial
Gases– EMEA |
Industrial
Gases– Asia |
Industrial
Gases– Global |
Corporate
and other |
Total
|
%
|
|||||||||||||
Three Months Ended 31 December 2018
|
|
|
|
|
|
|
|
|||||||||||||
On-site
|
|
$596.0
|
|
|
$222.2
|
|
|
$381.0
|
|
|
$—
|
|
|
$—
|
|
|
$1,199.2
|
|
54
|
%
|
Merchant
|
393.2
|
|
302.0
|
|
245.8
|
|
—
|
|
—
|
|
941.0
|
|
42
|
%
|
||||||
Sale of Equipment
|
—
|
|
—
|
|
—
|
|
68.2
|
|
15.6
|
|
83.8
|
|
4
|
%
|
||||||
Total
|
|
$989.2
|
|
|
$524.2
|
|
|
$626.8
|
|
|
$68.2
|
|
|
$15.6
|
|
|
$2,224.0
|
|
100
|
%
|
|
30 September 2018
|
|
New Revenue Standard Adjustments
|
|
1 October 2018
|
|
|||
Assets
|
|
|
|
||||||
Current Assets
|
|
|
|
||||||
Cash and cash items
|
|
$2,791.3
|
|
|
$—
|
|
|
$2,791.3
|
|
Short-term investments
|
184.7
|
|
—
|
|
184.7
|
|
|||
Trade receivables, net
|
1,207.2
|
|
—
|
|
1,207.2
|
|
|||
Inventories
|
396.1
|
|
—
|
|
396.1
|
|
|||
Contracts in progress, less progress billings
|
77.5
|
|
(77.5
|
)
|
—
|
|
|||
Prepaid expenses
|
129.6
|
|
—
|
|
129.6
|
|
|||
Other receivables and current assets
|
295.8
|
|
103.7
|
|
399.5
|
|
|||
Total Current Assets
|
5,082.2
|
|
26.2
|
|
5,108.4
|
|
|||
Total Noncurrent Assets
|
14,096.1
|
|
—
|
|
14,096.1
|
|
|||
Total Assets
|
|
$19,178.3
|
|
|
$26.2
|
|
|
$19,204.5
|
|
Liabilities and Equity
|
|
|
|
||||||
Current Liabilities
|
|
|
|
||||||
Payables and accrued liabilities
|
|
$1,817.8
|
|
|
$26.2
|
|
|
$1,844.0
|
|
Accrued income taxes
|
59.6
|
|
—
|
|
59.6
|
|
|||
Short-term borrowings
|
54.3
|
|
—
|
|
54.3
|
|
|||
Current portion of long-term debt
|
406.6
|
|
—
|
|
406.6
|
|
|||
Total Current Liabilities
|
2,338.3
|
|
26.2
|
|
2,364.5
|
|
|||
Total Noncurrent Liabilities
|
5,663.7
|
|
—
|
|
5,663.7
|
|
|||
Total Liabilities
|
8,002.0
|
|
26.2
|
|
8,028.2
|
|
|||
Total Equity
|
11,176.3
|
|
—
|
|
11,176.3
|
|
|||
Total Liabilities and Equity
|
|
$19,178.3
|
|
|
$26.2
|
|
|
$19,204.5
|
|
|
31 December 2018
|
1 October 2018
|
||||
Assets
|
|
|
||||
Contract assets – current
|
|
$51.5
|
|
|
$53.0
|
|
Contract fulfillment costs – current
|
54.0
|
|
50.7
|
|
||
Liabilities
|
|
|
||||
Contract liabilities – current
|
152.4
|
|
174.5
|
|
||
Contract liabilities – noncurrent
|
52.5
|
|
53.5
|
|
|
|
31 December
|
|
30 September
|
||||
|
|
2018
|
|
2018
|
||||
Finished goods
|
|
|
$138.4
|
|
|
|
$125.4
|
|
Work in process
|
|
20.4
|
|
|
21.2
|
|
||
Raw materials, supplies and other
|
|
244.6
|
|
|
249.5
|
|
||
Inventories
|
|
|
$403.4
|
|
|
|
$396.1
|
|
|
|
Industrial
Gases–
Americas
|
|
Industrial
Gases–
EMEA
|
|
Industrial
Gases–
Asia
|
|
Industrial
Gases–
Global
|
|
Corporate and other
|
|
Total
|
||||||||||||
Goodwill, net at 30 September 2018
|
|
|
$162.1
|
|
|
|
$424.4
|
|
|
|
$171.9
|
|
|
|
$20.1
|
|
|
|
$10.4
|
|
|
|
$788.9
|
|
Currency translation and other
|
|
(3.2
|
)
|
|
(5.2
|
)
|
|
(.1
|
)
|
|
(.3
|
)
|
|
.3
|
|
|
(8.5
|
)
|
||||||
Goodwill, net at 31 December 2018
|
|
|
$158.9
|
|
|
|
$419.2
|
|
|
|
$171.8
|
|
|
|
$19.8
|
|
|
|
$10.7
|
|
|
|
$780.4
|
|
|
|
31 December
|
|
30 September
|
||||
|
|
2018
|
|
2018
|
||||
Goodwill, gross
|
|
|
$1,164.1
|
|
|
|
$1,194.7
|
|
Accumulated impairment losses(A)
|
|
(383.7
|
)
|
|
(405.8
|
)
|
||
Goodwill, net
|
|
|
$780.4
|
|
|
|
$788.9
|
|
(A)
|
Accumulated impairment losses are attributable to our Latin America reporting unit (LASA) within the Industrial Gases – Americas segment and include the impacts of currency translation.
|
|
|
31 December 2018
|
|
30 September 2018
|
||||||||
|
|
US$
Notional
|
|
Years
Average
Maturity
|
|
US$
Notional
|
|
Years
Average
Maturity
|
||||
Forward Exchange Contracts:
|
|
|
|
|
|
|
|
|
||||
Cash flow hedges
|
|
|
$2,666.9
|
|
|
0.5
|
|
|
$2,489.1
|
|
|
0.4
|
Net investment hedges
|
|
448.2
|
|
|
1.4
|
|
457.5
|
|
|
1.7
|
||
Not designated
|
|
808.6
|
|
|
1.3
|
|
1,736.1
|
|
|
0.8
|
||
Total Forward Exchange Contracts
|
|
|
$3,923.7
|
|
|
0.8
|
|
|
$4,682.7
|
|
|
0.7
|
|
|
31 December 2018
|
|
30 September 2018
|
||||||||||||||||||||
|
|
US$
Notional
|
|
Average
Pay %
|
|
Average
Receive
%
|
|
Years
Average
Maturity
|
|
US$
Notional
|
|
Average
Pay %
|
|
Average
Receive
%
|
|
Years
Average
Maturity
|
||||||||
Interest rate swaps
(fair value hedge)
|
|
|
$600.0
|
|
|
LIBOR
|
|
|
2.60
|
%
|
|
1.4
|
|
|
$600.0
|
|
|
LIBOR
|
|
|
2.60
|
%
|
|
1.6
|
Cross currency interest rate swaps
(net investment hedge)
|
|
|
$265.4
|
|
|
4.63
|
%
|
|
3.10
|
%
|
|
3.3
|
|
|
$201.7
|
|
|
4.42
|
%
|
|
2.97
|
%
|
|
3.1
|
Cross currency interest rate swaps
(cash flow hedge)
|
|
|
$1,048.6
|
|
|
4.99
|
%
|
|
2.90
|
%
|
|
2.2
|
|
|
$1,052.7
|
|
|
4.99
|
%
|
|
2.89
|
%
|
|
2.3
|
Cross currency interest rate swaps
(not designated)
|
|
|
$16.5
|
|
|
3.33
|
%
|
|
3.15
|
%
|
|
0.2
|
|
|
$80.2
|
|
|
4.88
|
%
|
|
3.43
|
%
|
|
3.9
|
|
Balance Sheet
Location
|
31 December 2018
|
30 September 2018
|
Balance Sheet
Location
|
31 December 2018
|
30 September 2018
|
||||||||
Derivatives Designated as Hedging Instruments:
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
Other receivables
|
|
$34.7
|
|
|
$24.9
|
|
Accrued liabilities
|
|
$27.9
|
|
|
$37.0
|
|
Interest rate management contracts
|
Other receivables
|
23.0
|
|
24.3
|
|
Accrued liabilities
|
1.3
|
|
2.3
|
|
||||
Forward exchange contracts
|
Other noncurrent
assets
|
25.7
|
|
19.8
|
|
Other noncurrent
liabilities
|
1.9
|
|
4.6
|
|
||||
Interest rate management contracts
|
Other noncurrent
assets
|
39.1
|
|
48.7
|
|
Other noncurrent
liabilities
|
9.1
|
|
11.6
|
|
||||
Total Derivatives Designated as Hedging Instruments
|
|
|
$122.5
|
|
|
$117.7
|
|
|
|
$40.2
|
|
|
$55.5
|
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
Other receivables
|
|
$.9
|
|
|
$7.9
|
|
Accrued liabilities
|
|
$1.1
|
|
|
$14.9
|
|
Interest rate management contracts
|
Other receivables
|
3.6
|
|
4.0
|
|
Accrued liabilities
|
—
|
|
—
|
|
||||
Forward exchange contracts
|
Other noncurrent
assets
|
21.4
|
|
16.2
|
|
Other noncurrent
liabilities
|
28.9
|
|
23.7
|
|
||||
Interest rate management contracts
|
Other noncurrent
assets
|
—
|
|
.3
|
|
Other noncurrent
liabilities
|
—
|
|
—
|
|
||||
Total Derivatives Not Designated as Hedging Instruments
|
|
|
$25.9
|
|
|
$28.4
|
|
|
|
$30.0
|
|
|
$38.6
|
|
Total Derivatives
|
|
|
$148.4
|
|
|
$146.1
|
|
|
|
$70.2
|
|
|
$94.1
|
|
|
Three Months Ended 31 December
|
|||||||||||||||||||||||
|
Forward
Exchange Contracts
|
Foreign Currency
Debt
|
Other (A)
|
Total
|
||||||||||||||||||||
|
2018
|
2017
|
2018
|
2017
|
2018
|
2017
|
2018
|
2017
|
||||||||||||||||
Cash Flow Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI (effective portion)
|
|
$4.0
|
|
|
$7.5
|
|
|
$—
|
|
|
$—
|
|
|
($14.3
|
)
|
|
($17.0
|
)
|
|
($10.3
|
)
|
|
($9.5
|
)
|
Net (gain) loss reclassified from OCI to sales/cost of sales (effective portion)
|
.5
|
|
1.0
|
|
—
|
|
—
|
|
—
|
|
—
|
|
.5
|
|
1.0
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (effective portion)
|
(9.3
|
)
|
(17.6
|
)
|
—
|
|
—
|
|
1.8
|
|
16.4
|
|
(7.5
|
)
|
(1.2
|
)
|
||||||||
Net (gain) loss reclassified from OCI to interest expense (effective portion)
|
3.1
|
|
.6
|
|
—
|
|
—
|
|
.7
|
|
.6
|
|
3.8
|
|
1.2
|
|
||||||||
Net (gain) loss reclassified from OCI to other income (expense), net (ineffective portion)
|
.1
|
|
(.2
|
)
|
—
|
|
—
|
|
—
|
|
—
|
|
.1
|
|
(.2
|
)
|
||||||||
Fair Value Hedges:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in interest expense(B)
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$—
|
|
|
$2.6
|
|
|
($3.2
|
)
|
|
$2.6
|
|
|
($3.2
|
)
|
Net Investment Hedges, net of tax:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in OCI
|
|
$11.8
|
|
|
($7.5
|
)
|
|
$9.6
|
|
|
($17.3
|
)
|
|
$.6
|
|
|
($11.2
|
)
|
|
$22.0
|
|
|
($36.0
|
)
|
Derivatives Not Designated as Hedging Instruments:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net gain (loss) recognized in other income (expense), net(C)
|
|
($.1
|
)
|
|
($1.5
|
)
|
|
$—
|
|
|
$—
|
|
|
$.8
|
|
|
($1.3
|
)
|
|
$.7
|
|
|
($2.8
|
)
|
|
|
|
|
|
|
|
|
|
(A)
|
Includes the impact on other comprehensive income (OCI) and earnings primarily related to interest rate and cross currency interest rate swaps.
|
(B)
|
The impact of fair value hedges was largely offset by recognized gains and losses resulting from the impact of changes in related interest rates on outstanding debt.
|
(C)
|
The impact of the non-designated hedges was largely offset by recognized gains and losses resulting from the impact of changes in exchange rates on assets and liabilities denominated in non-functional currencies.
|
Level 1
|
— Quoted prices (unadjusted) in active markets for identical assets or liabilities.
|
Level 2
|
— Inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the asset or liability.
|
Level 3
|
— Inputs that are unobservable for the asset or liability based on our own assumptions about the assumptions market participants would use in pricing the asset or liability.
|
|
|
31 December 2018
|
|
30 September 2018
|
||||||||||||
|
|
Carrying Value
|
|
Fair Value
|
|
Carrying Value
|
|
Fair Value
|
||||||||
Assets
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
|
$82.7
|
|
|
|
$82.7
|
|
|
|
$68.8
|
|
|
|
$68.8
|
|
Interest rate management contracts
|
|
65.7
|
|
|
65.7
|
|
|
77.3
|
|
|
77.3
|
|
||||
Liabilities
|
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
|
||||||||
Forward exchange contracts
|
|
|
$59.8
|
|
|
|
$59.8
|
|
|
|
$80.2
|
|
|
|
$80.2
|
|
Interest rate management contracts
|
|
10.4
|
|
|
10.4
|
|
|
13.9
|
|
|
13.9
|
|
||||
Long-term debt, including current portion and related party
|
|
3,744.9
|
|
|
3,782.9
|
|
|
3,758.3
|
|
|
3,788.2
|
|
|
31 December 2018
|
|
30 September 2018
|
||||||||||||||||||||||
|
Total
|
Level 1
|
Level 2
|
Level 3
|
|
Total
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||||||
Assets at Fair Value
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward exchange contracts
|
|
$82.7
|
|
|
$—
|
|
|
$82.7
|
|
|
$—
|
|
|
|
$68.8
|
|
|
$—
|
|
|
$68.8
|
|
|
$—
|
|
Interest rate management contracts
|
65.7
|
|
—
|
|
65.7
|
|
—
|
|
|
77.3
|
|
—
|
|
77.3
|
|
—
|
|
||||||||
Total Assets at Fair Value
|
|
$148.4
|
|
|
$—
|
|
|
$148.4
|
|
|
$—
|
|
|
|
$146.1
|
|
|
$—
|
|
|
$146.1
|
|
|
$—
|
|
Liabilities at Fair Value
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Derivatives
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Forward exchange contracts
|
|
$59.8
|
|
|
$—
|
|
|
$59.8
|
|
|
$—
|
|
|
|
$80.2
|
|
|
$—
|
|
|
$80.2
|
|
|
$—
|
|
Interest rate management contracts
|
10.4
|
|
—
|
|
10.4
|
|
—
|
|
|
13.9
|
|
—
|
|
13.9
|
|
—
|
|
||||||||
Total Liabilities at Fair Value
|
|
$70.2
|
|
|
$—
|
|
|
$70.2
|
|
|
$—
|
|
|
|
$94.1
|
|
|
$—
|
|
|
$94.1
|
|
|
$—
|
|
|
Pension Benefits
|
||||||||||||||
|
2018
|
|
2017
|
||||||||||||
Three Months Ended 31 December
|
U.S.
|
|
International
|
|
U.S.
|
|
International
|
||||||||
Service cost
|
|
$5.4
|
|
|
|
$4.9
|
|
|
|
$6.4
|
|
|
|
$6.3
|
|
Interest cost
|
28.4
|
|
|
9.0
|
|
|
26.7
|
|
|
9.2
|
|
||||
Expected return on plan assets
|
(43.1
|
)
|
|
(18.9
|
)
|
|
(50.4
|
)
|
|
(20.2
|
)
|
||||
Prior service cost amortization
|
.3
|
|
|
—
|
|
|
.4
|
|
|
—
|
|
||||
Actuarial loss amortization
|
16.1
|
|
|
2.8
|
|
|
21.7
|
|
|
10.0
|
|
||||
Settlements
|
.8
|
|
|
.2
|
|
|
1.8
|
|
|
—
|
|
||||
Special termination benefits
|
.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Other
|
—
|
|
|
.3
|
|
|
—
|
|
|
.5
|
|
||||
Net Periodic (Benefit) Cost
|
|
$8.6
|
|
|
|
($1.7
|
)
|
|
|
$6.6
|
|
|
|
$5.8
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
||||||
|
|
31 December
|
||||||
|
|
2018
|
|
2017
|
||||
Before-tax share-based compensation cost
|
|
|
$9.3
|
|
|
|
$11.8
|
|
Income tax benefit
|
|
(2.2
|
)
|
|
(3.2
|
)
|
||
After-tax share-based compensation cost
|
|
|
$7.1
|
|
|
|
$8.6
|
|
Expected volatility
|
|
17.5
|
%
|
Risk-free interest rate
|
|
2.8
|
%
|
Expected dividend yield
|
|
2.6
|
%
|
|
Derivatives
qualifying as
hedges
|
|
Foreign
currency
translation
adjustments
|
|
Pension and
postretirement
benefits
|
|
Total
|
|
||||
Balance at 30 September 2018
|
|
($37.6
|
)
|
|
($1,009.8
|
)
|
|
($694.5
|
)
|
|
($1,741.9
|
)
|
Other comprehensive loss before reclassifications
|
(10.3
|
)
|
(68.1
|
)
|
(3.9
|
)
|
(82.3
|
)
|
||||
Amounts reclassified from AOCL
|
(3.1
|
)
|
—
|
|
15.2
|
|
12.1
|
|
||||
Net current period other comprehensive income (loss)
|
(13.4
|
)
|
(68.1
|
)
|
11.3
|
|
(70.2
|
)
|
||||
Amount attributable to noncontrolling interests
|
(.1
|
)
|
(.8
|
)
|
—
|
|
(.9
|
)
|
||||
Balance at 31 December 2018
|
|
($50.9
|
)
|
|
($1,077.1
|
)
|
|
($683.2
|
)
|
|
($1,811.2
|
)
|
|
|
|
|
|
|
Three Months Ended
|
|||||
|
31 December
|
|||||
|
2018
|
2017
|
||||
(Gain) Loss on Cash Flow Hedges, net of tax
|
|
|
||||
Sales/Cost of sales
|
|
$.5
|
|
|
$1.0
|
|
Other income/expense, net
|
(7.4
|
)
|
(1.4
|
)
|
||
Interest expense
|
3.8
|
|
1.2
|
|
||
Total (Gain) Loss on Cash Flow Hedges, net of tax
|
|
($3.1
|
)
|
|
$.8
|
|
Currency Translation Adjustment(A)
|
|
$—
|
|
|
$3.1
|
|
Pension and Postretirement Benefits, net of tax(B)
|
|
$15.2
|
|
|
$22.9
|
|
(A)
|
The fiscal year 2018 impact is reflected in "Cost of sales" on the consolidated income statements and relates to an equipment sale resulting from the termination of a contract in the Industrial Gases – Asia segment.
|
(B)
|
The components of net periodic benefit cost reclassified out of AOCL include items such as prior service cost amortization, actuarial loss amortization, and settlements and are included in “Other non-operating income (expense), net” on the consolidated income statements. Refer to Note 9, Retirement Benefits, for additional information.
|
|
|
Three Months Ended
|
||||||
|
|
31 December
|
||||||
|
|
2018
|
|
2017
|
||||
Numerator
|
|
|
|
|
||||
Income from continuing operations
|
|
|
$347.5
|
|
|
|
$155.6
|
|
Loss from discontinued operations
|
|
—
|
|
|
(1.0
|
)
|
||
Net Income Attributable to Air Products
|
|
|
$347.5
|
|
|
|
$154.6
|
|
Denominator (in millions)
|
|
|
|
|
||||
Weighted average common shares — Basic
|
|
219.9
|
|
|
218.9
|
|
||
Effect of dilutive securities
|
|
|
|
|
||||
Employee stock option and other award plans
|
|
1.1
|
|
|
1.5
|
|
||
Weighted average common shares — Diluted
|
|
221.0
|
|
|
220.4
|
|
||
Basic EPS Attributable to Air Products
|
|
|
|
|
||||
Income from continuing operations
|
|
|
$1.58
|
|
|
|
$.71
|
|
Loss from discontinued operations
|
|
—
|
|
|
—
|
|
||
Net Income Attributable to Air Products
|
|
|
$1.58
|
|
|
|
$.71
|
|
Diluted EPS Attributable to Air Products
|
|
|
|
|
||||
Income from continuing operations
|
|
|
$1.57
|
|
|
|
$.70
|
|
Loss from discontinued operations
|
|
—
|
|
|
—
|
|
||
Net Income Attributable to Air Products
|
|
|
$1.57
|
|
|
|
$.70
|
|
•
|
Industrial Gases – Americas
|
•
|
Industrial Gases – EMEA (Europe, Middle East, and Africa)
|
•
|
Industrial Gases – Asia
|
•
|
Industrial Gases – Global
|
•
|
Corporate and other
|
|
Industrial
Gases –
Americas
|
Industrial
Gases –
EMEA
|
Industrial
Gases –
Asia
|
Industrial
Gases –
Global
|
Corporate
and other
|
Segment
Total
|
||||||||||||
Three Months Ended 31 December 2018
|
||||||||||||||||||
Sales
|
|
$989.2
|
|
|
$524.2
|
|
|
$626.8
|
|
|
$68.2
|
|
|
$15.6
|
|
|
$2,224.0
|
|
Operating income (loss)
|
219.2
|
|
105.6
|
|
201.8
|
|
3.9
|
|
(46.5
|
)
|
484.0
|
|
||||||
Depreciation and amortization
|
125.6
|
|
46.3
|
|
79.9
|
|
2.1
|
|
4.1
|
|
258.0
|
|
||||||
Equity affiliates' income
|
22.6
|
|
13.7
|
|
16.2
|
|
.4
|
|
—
|
|
52.9
|
|
||||||
Three Months Ended 31 December 2017
|
||||||||||||||||||
Sales
|
|
$909.8
|
|
|
$515.9
|
|
|
$643.6
|
|
|
$133.0
|
|
|
$14.3
|
|
|
$2,216.6
|
|
Operating income (loss)
|
217.2
|
|
104.5
|
|
175.5
|
|
9.5
|
|
(46.0
|
)
|
460.7
|
|
||||||
Depreciation and amortization
|
117.8
|
|
49.1
|
|
56.8
|
|
1.6
|
|
2.6
|
|
227.9
|
|
||||||
Equity affiliates' income
|
18.6
|
|
13.1
|
|
14.2
|
|
.4
|
|
—
|
|
46.3
|
|
||||||
Total Assets
|
||||||||||||||||||
31 December 2018
|
|
$5,859.6
|
|
|
$3,214.6
|
|
|
$6,037.0
|
|
|
$255.4
|
|
|
$3,775.4
|
|
|
$19,142.0
|
|
30 September 2018
|
5,904.0
|
|
3,280.4
|
|
5,899.5
|
|
240.1
|
|
3,854.3
|
|
19,178.3
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Three Months Ended
|
|||||
|
31 December
|
|||||
Operating Income
|
2018
|
2017
|
||||
Segment total
|
|
$484.0
|
|
|
$460.7
|
|
Facility closure
|
(29.0
|
)
|
—
|
|
||
Consolidated Total
|
|
$455.0
|
|
|
$460.7
|
|
|
Three Months Ended
|
|||||
|
31 December
|
|||||
Equity Affiliates' Income
|
2018
|
2017
|
||||
Segment total
|
|
$52.9
|
|
|
$46.3
|
|
Tax reform repatriation - equity method investment
|
—
|
|
(32.5
|
)
|
||
Consolidated Total
|
|
$52.9
|
|
|
$13.8
|
|
•
|
Sales of $2,224.0 were flat versus the prior year as higher energy and natural gas cost pass-through to customers and positive pricing was offset primarily by unfavorable volumes and currency impacts.
|
•
|
Operating income of $455.0 decreased 1%, or $5.7, and operating margin of 20.5% decreased 30 basis points (bp). On a non-GAAP basis, adjusted operating income of $484.0 increased 5%, or $23.3, and adjusted operating margin of 21.8% increased 100 bp.
|
•
|
Income from continuing operations of $347.5 increased 123%, or $191.9. On a non-GAAP basis, adjusted income from continuing operations of $410.2 increased 4%, or $15.6.
|
•
|
Diluted EPS of $1.57 increased 124%, or $.87. On a non-GAAP basis, adjusted diluted EPS of $1.86 increased 4%, or $.07. A summary table of changes in diluted EPS is presented below.
|
•
|
Adjusted EBITDA of $794.9 increased 8%, or $60.0. Adjusted EBITDA margin of 35.7% increased 250 bp.
|
Changes in Diluted EPS Attributable to Air Products
|
|||||||||
|
|
|
|
||||||
|
Three Months Ended
|
|
|||||||
|
31 December
|
Increase
|
|||||||
|
2018
|
2017
|
(Decrease)
|
||||||
Diluted EPS from Continuing Operations – GAAP
|
|
$1.57
|
|
|
$.70
|
|
|
$.87
|
|
Operating Income Impact (after-tax)
|
|
|
|
||||||
Underlying business
|
|
|
|
||||||
Volume
|
|
|
|
$.13
|
|
||||
Price/raw materials
|
|
|
.05
|
|
|||||
Costs
|
|
|
(.06
|
)
|
|||||
Currency
|
|
|
(.04
|
)
|
|||||
Facility closure
|
|
|
(.10
|
)
|
|||||
Total Operating Income Impact (after-tax)
|
|
|
|
($.02
|
)
|
||||
Other Impact (after-tax)
|
|
|
|
||||||
Equity affiliates' income
|
|
|
|
$.03
|
|
||||
Interest expense
|
|
|
(.03
|
)
|
|||||
Other non-operating income (expense), net
|
|
|
.03
|
|
|||||
Income tax
|
|
|
(.03
|
)
|
|||||
Tax reform repatriation
|
|
|
2.13
|
|
|||||
Tax reform adjustment related to deemed foreign dividends
|
|
|
(.26
|
)
|
|||||
Tax reform rate change and other
|
|
|
(.97
|
)
|
|||||
Noncontrolling interests
|
|
|
(.01
|
)
|
|||||
Total Other Impact (after-tax)
|
|
|
|
$.89
|
|
||||
Total Change in Diluted EPS from Continuing Operations – GAAP
|
|
|
|
$.87
|
|
|
Three Months Ended
|
|
|||||||
|
31 December
|
Increase
|
|||||||
|
2018
|
2017
|
(Decrease)
|
||||||
Diluted EPS from Continuing Operations – GAAP
|
|
$1.57
|
|
|
$.70
|
|
|
$.87
|
|
Facility closure
|
.10
|
|
—
|
|
.10
|
|
|||
Tax reform repatriation
|
(.07
|
)
|
2.06
|
|
(2.13
|
)
|
|||
Tax reform adjustment related to deemed foreign dividends
|
.26
|
|
—
|
|
.26
|
|
|||
Tax reform rate change and other
|
—
|
|
(.97
|
)
|
.97
|
|
|||
Diluted EPS from Continuing Operations – Non-GAAP Measure
|
|
$1.86
|
|
|
$1.79
|
|
|
$.07
|
|
|
|
Three Months Ended
|
|
|
|
|
|||||||||
|
|
31 December
|
|
|
|
|
|||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
Change
|
|||||||
Sales
|
|
|
$2,224.0
|
|
|
|
$2,216.6
|
|
|
|
$7.4
|
|
|
—
|
%
|
Operating income
|
|
455.0
|
|
|
460.7
|
|
|
(5.7
|
)
|
|
(1
|
)%
|
|||
Operating margin
|
|
20.5
|
%
|
|
20.8
|
%
|
|
|
|
|
(30
|
) bp
|
|||
Equity affiliates’ income
|
|
52.9
|
|
|
13.8
|
|
|
39.1
|
|
|
283
|
%
|
|||
Income from continuing operations
|
|
347.5
|
|
|
155.6
|
|
|
191.9
|
|
|
123
|
%
|
|||
Non-GAAP Measures
|
|
|
|
|
|
|
|
|
|||||||
Adjusted EBITDA
|
|
|
$794.9
|
|
|
|
$734.9
|
|
|
|
$60.0
|
|
|
8
|
%
|
Adjusted EBITDA margin
|
|
35.7
|
%
|
|
33.2
|
%
|
|
|
|
250 bp
|
|
||||
Adjusted operating income
|
|
484.0
|
|
|
460.7
|
|
|
23.3
|
|
|
5
|
%
|
|||
Adjusted operating margin
|
|
21.8
|
%
|
|
20.8
|
%
|
|
|
|
100 bp
|
|
||||
Adjusted equity affiliates' income
|
|
52.9
|
|
|
46.3
|
|
|
6.6
|
|
|
14
|
%
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
(3
|
)%
|
Price
|
1
|
%
|
Energy and natural gas cost pass-through
|
5
|
%
|
Currency
|
(2
|
)%
|
Other
|
(1
|
)%
|
Total Consolidated Change
|
—
|
%
|
|
Three Months Ended
|
|||||
|
31 December
|
|||||
|
2018
|
2017
|
||||
Interest incurred
|
|
$40.0
|
|
|
$32.6
|
|
Less: capitalized interest
|
2.7
|
|
2.8
|
|
||
Interest expense
|
|
$37.3
|
|
|
$29.8
|
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
31 December
|
|
|
|
|
||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
|
$989.2
|
|
|
|
$909.8
|
|
|
|
$79.4
|
|
|
9%
|
Operating income
|
|
219.2
|
|
|
217.2
|
|
|
2.0
|
|
|
1%
|
|||
Operating margin
|
|
22.2
|
%
|
|
23.9
|
%
|
|
|
|
(170) bp
|
||||
Equity affiliates’ income
|
|
22.6
|
|
|
18.6
|
|
|
4.0
|
|
|
22%
|
|||
Adjusted EBITDA
|
|
367.4
|
|
|
353.6
|
|
|
13.8
|
|
|
4%
|
|||
Adjusted EBITDA margin
|
|
37.1
|
%
|
|
38.9
|
%
|
|
|
|
(180) bp
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
2
|
%
|
Price
|
2
|
%
|
Energy and natural gas cost pass-through
|
7
|
%
|
Currency
|
(2
|
)%
|
Total Industrial Gases – Americas Sales Change
|
9
|
%
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
31 December
|
|
|
|
|
||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
|
$524.2
|
|
|
|
$515.9
|
|
|
|
$8.3
|
|
|
2%
|
Operating income
|
|
105.6
|
|
|
104.5
|
|
|
1.1
|
|
|
1%
|
|||
Operating margin
|
|
20.1
|
%
|
|
20.3
|
%
|
|
|
|
(20) bp
|
||||
Equity affiliates’ income
|
|
13.7
|
|
|
13.1
|
|
|
.6
|
|
|
5%
|
|||
Adjusted EBITDA
|
|
165.6
|
|
|
166.7
|
|
|
(1.1
|
)
|
|
(1)%
|
|||
Adjusted EBITDA margin
|
|
31.6
|
%
|
|
32.3
|
%
|
|
|
|
(70) bp
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
1
|
%
|
Price
|
2
|
%
|
Energy and natural gas cost pass-through
|
6
|
%
|
Currency
|
(4
|
)%
|
Other
|
(3
|
)%
|
Total Industrial Gases – EMEA Sales Change
|
2
|
%
|
|
|
Three Months Ended
|
|
|
|
|
||||||||
|
|
31 December
|
|
|
|
|
||||||||
|
|
2018
|
|
2017
|
|
$ Change
|
|
% Change
|
||||||
Sales
|
|
|
$626.8
|
|
|
|
$643.6
|
|
|
|
($16.8
|
)
|
|
(3)%
|
Operating income
|
|
201.8
|
|
|
175.5
|
|
|
26.3
|
|
|
15%
|
|||
Operating margin
|
|
32.2
|
%
|
|
27.3
|
%
|
|
|
|
490 bp
|
||||
Equity affiliates’ income
|
|
16.2
|
|
|
14.2
|
|
|
2.0
|
|
|
14%
|
|||
Adjusted EBITDA
|
|
297.9
|
|
|
246.5
|
|
|
51.4
|
|
|
21%
|
|||
Adjusted EBITDA margin
|
|
47.5
|
%
|
|
38.3
|
%
|
|
|
|
920 bp
|
Sales
|
% Change from
Prior Year
|
|
Underlying business
|
|
|
Volume
|
(2
|
)%
|
Price
|
1
|
%
|
Energy and natural gas cost pass-through
|
1
|
%
|
Currency
|
(3
|
)%
|
Total Industrial Gases – Asia Sales Change
|
(3
|
)%
|
|
Continuing Operations
|
||||||||||||||||
|
Three Months Ended 31 December
|
||||||||||||||||
Q1 2019 vs. Q1 2018
|
Operating
Income |
Operating
Margin(A) |
Equity Affiliates' Income
|
Income Tax
Provision |
Net
Income |
Diluted
EPS |
|||||||||||
2019 GAAP
|
|
$455.0
|
|
20.5
|
%
|
|
$52.9
|
|
|
$132.1
|
|
|
$347.5
|
|
|
$1.57
|
|
2018 GAAP
|
460.7
|
|
20.8
|
%
|
13.8
|
|
291.8
|
|
155.6
|
|
.70
|
|
|||||
Change GAAP
|
|
($5.7
|
)
|
(30
|
)bp
|
|
$39.1
|
|
|
($159.7
|
)
|
|
$191.9
|
|
|
$.87
|
|
% Change GAAP
|
(1
|
)%
|
|
283
|
%
|
(55
|
)%
|
123
|
%
|
124
|
%
|
||||||
2019 GAAP
|
|
$455.0
|
|
20.5
|
%
|
|
$52.9
|
|
|
$132.1
|
|
|
$347.5
|
|
|
$1.57
|
|
Facility closure
|
29.0
|
|
1.3
|
%
|
—
|
|
6.9
|
|
22.1
|
|
.10
|
|
|||||
Tax reform repatriation
|
—
|
|
—
|
%
|
—
|
|
15.6
|
|
(15.6
|
)
|
(.07
|
)
|
|||||
Tax reform adjustment related to deemed foreign dividends
|
—
|
|
—
|
%
|
—
|
|
(56.2
|
)
|
56.2
|
|
.26
|
|
|||||
2019 Non-GAAP Measure
|
|
$484.0
|
|
21.8
|
%
|
|
$52.9
|
|
|
$98.4
|
|
|
$410.2
|
|
|
$1.86
|
|
2018 GAAP
|
|
$460.7
|
|
20.8
|
%
|
|
$13.8
|
|
|
$291.8
|
|
|
$155.6
|
|
|
$.70
|
|
Tax reform repatriation
|
—
|
|
—
|
%
|
32.5
|
|
(420.5
|
)
|
453.0
|
|
2.06
|
|
|||||
Tax reform rate change and other
|
—
|
|
—
|
%
|
—
|
|
214.0
|
|
(214.0
|
)
|
(.97
|
)
|
|||||
2018 Non-GAAP Measure
|
|
$460.7
|
|
20.8
|
%
|
|
$46.3
|
|
|
$85.3
|
|
|
$394.6
|
|
|
$1.79
|
|
Change Non-GAAP Measure
|
|
$23.3
|
|
100
|
bp
|
|
$6.6
|
|
|
$13.1
|
|
|
$15.6
|
|
|
$.07
|
|
% Change Non-GAAP Measure
|
5
|
%
|
|
14
|
%
|
15
|
%
|
4
|
%
|
4
|
%
|
(A)
|
Operating margin is calculated by dividing operating income by sales.
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|||||
|
31 December
|
|||||
Equity Affiliates' Income
|
2018
|
2017
|
||||
Consolidated total
|
|
$52.9
|
|
|
$13.8
|
|
Tax reform repatriation - equity method investment
|
—
|
|
32.5
|
|
||
Segment total
|
|
$52.9
|
|
|
$46.3
|
|
|
Three Months Ended
|
|||||
|
31 December
|
|||||
|
2018
|
2017
|
||||
Income from Continuing Operations(A)
|
|
$357.0
|
|
|
$162.7
|
|
Add: Facility closure
|
29.0
|
|
—
|
|
||
Add: Interest expense
|
37.3
|
|
29.8
|
|
||
Less: Other non-operating income (expense), net
|
18.5
|
|
9.8
|
|
||
Add: Income tax provision
|
132.1
|
|
291.8
|
|
||
Add: Depreciation and amortization
|
258.0
|
|
227.9
|
|
||
Add: Tax reform repatriation - equity method investment
|
—
|
|
32.5
|
|
||
Adjusted EBITDA
|
|
$794.9
|
|
|
$734.9
|
|
Adjusted EBITDA margin
|
35.7
|
%
|
33.2
|
%
|
||
Change GAAP
|
|
|
||||
Income from continuing operations change
|
|
$194.3
|
|
|
||
Income from continuing operations % change
|
119
|
%
|
|
|||
Change Non-GAAP
|
|
|
||||
Adjusted EBITDA change
|
|
$60.0
|
|
|
||
Adjusted EBITDA % change
|
8
|
%
|
|
|||
Adjusted EBITDA margin change
|
250
|
bp
|
|
(A)
|
Includes net income attributable to noncontrolling interests.
|
|
|
|
|
|
|
|
|
Effective Tax Rate
|
|||||
|
Three Months Ended
31 December |
|||||
|
2018
|
2017
|
||||
Income Tax Provision—GAAP
|
|
$132.1
|
|
|
$291.8
|
|
Income From Continuing Operations Before Taxes—GAAP
|
|
$489.1
|
|
|
$454.5
|
|
Effective Tax Rate—GAAP
|
27.0
|
%
|
64.2
|
%
|
||
Income Tax Provision—GAAP
|
|
$132.1
|
|
|
$291.8
|
|
Facility closure
|
6.9
|
|
—
|
|
||
Tax reform repatriation
|
15.6
|
|
(420.5
|
)
|
||
Tax reform adjustment related to deemed foreign dividends
|
(56.2
|
)
|
—
|
|
||
Tax reform rate change and other
|
—
|
|
214.0
|
|
||
Income Tax Provision—Non-GAAP Measure
|
|
$98.4
|
|
|
$85.3
|
|
Income From Continuing Operations Before Taxes—GAAP
|
|
$489.1
|
|
|
$454.5
|
|
Facility closure
|
29.0
|
|
—
|
|
||
Tax reform repatriation - equity method investment
|
—
|
|
32.5
|
|
||
Income From Continuing Operations Before Taxes—Non-GAAP Measure
|
|
$518.1
|
|
|
$487.0
|
|
Effective Tax Rate—Non-GAAP Measure
|
19.0
|
%
|
17.5
|
%
|
|
Three Months Ended
|
|||||
|
31 December
|
|||||
Cash provided by (used for)
|
2018
|
2017
|
||||
Operating activities
|
|
$655.2
|
|
|
$560.0
|
|
Investing activities
|
(226.5
|
)
|
(480.8
|
)
|
||
Financing activities
|
(289.8
|
)
|
(641.1
|
)
|
|
|
Three Months Ended
|
||||||
|
|
31 December
|
||||||
|
|
2018
|
|
2017
|
||||
Additions to plant and equipment
|
|
|
$403.4
|
|
|
|
$256.6
|
|
Acquisitions, less cash acquired
|
|
—
|
|
|
237.1
|
|
||
Capital expenditures
|
|
|
$403.4
|
|
|
|
$493.7
|
|
|
Exhibit No.
|
Description
|
|
|
|
|
10.1
|
|
|
|
|
|
10.2
|
|
|
|
|
|
10.3
|
|
|
|
|
|
10.4
|
|
|
|
|
|
10.5
|
|
|
|
|
|
31.1
|
|
|
|
|
|
31.2
|
|
|
|
|
|
32.1
|
|
|
|
|
|
101.INS
|
XBRL Instance Document. The XBRL Instance Document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
|
|
|
|
|
101.SCH
|
XBRL Taxonomy Extension Schema
|
|
|
|
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase
|
|
|
|
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase
|
|
|
|
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase
|
|
|
|
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase
|
|
|
|
†
|
The certification attached as Exhibit 32 that accompanies this Quarterly Report on Form 10-Q, is not deemed filed with the Securities and Exchange Commission and is not to be incorporated by reference into any filing of Air Products and Chemicals, Inc. under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, whether made before or after the date of this Form 10-Q, irrespective of any general incorporation language contained in such filing.
|
|
Air Products and Chemicals, Inc.
|
|
|
(Registrant)
|
|
|
|
|
Date: 25 January 2019
|
By:
|
/s/ M. Scott Crocco
|
|
|
M. Scott Crocco
|
|
|
Executive Vice President and Chief Financial Officer
|
1.
|
Restrictive Covenants.
|
(a)
|
Definitions. For purposes of this Paragraph 1, the following words shall have the following definitions.
|
(i)
|
“Affiliate” of a specified Person shall mean any Person which is under common control with the specified Person, or of which the specified Person is an executive officer, manager, trustee, executor or similar controlling Person.
|
(ii)
|
“Company” shall be deemed to include Air Products and Chemicals, Inc. and the subsidiaries and Affiliates of Air Products and Chemicals, Inc.
|
(iii)
|
“Business of the Company” means the production, manufacturing and distribution of industrial gases, including atmospheric and process gases; the designing and manufacturing of equipment for the production, processing, purification distribution or storage of gases or for natural gas liquefaction; and any other line of business conducted, developed or being developed by the Company during your employment with the Company, in each case, in which you are or were involved during the course of your
|
(iv)
|
“Confidential Information” means any non-public, proprietary confidential or trade secret information of the Company and/or its customers, including but not limited to, business processes, know-how, practices, methods, plans, research, operations, services, strategies, techniques, formulae, manuals, data, notes, diagrams, customer or vendor information, pricing or cost information, product plans, designs, experimental processes and inventions.
|
(v)
|
“Person” means any natural person, corporation, general partnership, limited partnership, limited liability company or partnership, joint venture, proprietorship or other business organization.
|
(vi)
|
“Provide Services” means to directly or indirectly, own, manage, control, or participate in the ownership, management or control of, or be employed or engaged by, participate in, serve on the board of directors of, consult with, contribute to, hold a security interest in, render services for, give advice to, provide assistance to or be otherwise affiliated or associated with.
|
(vii)
|
“Restricted Area” means any country in which you worked during your employment with the Company, over which you had supervisory responsibility for the Business of the Company while employed by the Company, or with respect to which you have Confidential Information pertaining to the Business of the Company.
|
(b)
|
Acknowledgment.
|
(i)
|
You acknowledge and agree that (A) the Business of the Company is intensely competitive and that your employment with the Company has required you to have access to, and knowledge of, Confidential Information, which is of vital importance to the success of the Business of the Company; (B) the use, disclosure or dissemination of any Confidential Information, except on behalf of the Company, could place the Company at a serious competitive disadvantage and could do serious damage, financial and otherwise, to the Business of the Company; and (C) the Company is engaged in business, and has customers, throughout the world.
|
(ii)
|
You further understand and acknowledge that the Company invests in customer relationships and as a result, has developed and will develop considerable goodwill with and among its customers. You agree that the Restrictive Covenants articulated herein are necessary to protect the Company’s legitimate business interests in its Confidential Information
|
(c)
|
Confidential Information.
|
(i)
|
You hereby expressly acknowledge and agree that the obligations in this Award Agreement are in addition to, and shall not supersede, the obligations you may have pursuant to other agreements with the Company, including, without limitation, your obligations under your Employee Patent and Confidential Information Agreement that you entered into when you were employed by the Company, which shall continue to apply in accordance with its terms.
|
(ii)
|
You agree that you have and will at all times hereafter, (A) treat all Confidential Information as strictly confidential; and (B) not directly or indirectly disclose, publish, communicate or make available Confidential Information, or allow it to be disclosed, published, communicated, or made available, in whole or part, to any Person who is not authorized by the Company to know such Confidential Information in the furtherance of the Company’s business.
|
(d)
|
Non-Disparagement. You agree not to directly or indirectly make, or cause to be made, any statement, observation or opinion that disparages or impugns the business or reputation of the Company, its products, services, agents or employees.
|
(e)
|
Permitted Disclosures. Pursuant to 18 U.S.C. § 1833(b), you understand that you will not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret of the Company that (i) is made (A) in confidence to a Federal, State, or local government official, either directly or indirectly, or to your attorney and (B) solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. You understand that if you file a lawsuit for retaliation by the Company for reporting a suspected violation of law, you may disclose the trade secret to your attorney and use the trade secret information in the court proceeding if you (I) file any document containing the trade secret under seal, and (II) do not disclose the trade secret, except pursuant to court order. Nothing in this Award Agreement, or any other agreement you have with the Company, is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by such section. Further, nothing in this Award Agreement or any other agreement you have with the Company shall prohibit or restrict you from making any disclosure of information or documents to any governmental agency or
|
(f)
|
Return of Company Property. You represent that upon request from the Company at any time and, without request, upon termination of your employment with the Company for any reason, you will deliver to the Company all memoranda, notes, records, manuals, or other documents, including all electronic or other copies of such materials and all documentation prepared or produced in connection therewith, containing Confidential Information, which is in your possession, custody and control, whether made or compiled by you or furnished to you by virtue of your employment with the Company. You further represent that you will deliver to the Company all vehicles, computers, credit cards, telephones, handheld electronic devices, office equipment and other property furnished to you by virtue of your employment with the Company.
|
(g)
|
Notice. You agree that during your employment with the Company and for two years after your employment with the Company terminates for any reason, you will give the Company ten (10) business days’ written notice of your intention to Provide Services to any other Person that engages in or is preparing to engage in the Business of the Company within the Restricted Area. Such written notice must provide sufficiently detailed information so as to allow the Company to determine if you will be in breach of this Award Agreement if you Provide Services to such other Person.
|
(h)
|
Non-Competition. During your employment by the Company and for two years after your employment with the Company terminates for any reason, you agree that you will not Provide Services to any Person, other than the Company, that engages in or is preparing to engage in the Business of the Company within the Restricted Area, unless (i) such other Person also engages in lines of business that are separate, distinct and divisible from the Business of the Company, (ii) you do not Provide Services, Confidential Information or strategy to the Business of the Company conducted by such other Person, and (iii) you do not attend meetings where the Business of the Company conducted by such other Person is discussed or where you could, even inadvertently, disclose Confidential Information. Your passive ownership of not more than one percent (1%) of the capital stock or other ownership or equity interest, or voting power, in a public company, registered under the Securities Exchange Act of 1934, as amended, shall not be deemed to be a violation of this paragraph.
|
(i)
|
Non-Solicitation; Non-Interference. During your employment by the Company and for two years after your last day of employment with the Company, you also agree that you will not, directly or indirectly without the prior written consent of the Company:
|
(i)
|
encourage, persuade, induce, or attempt to encourage or persuade or induce, any person who is an employee at the grade level of 118 or above,
|
(ii)
|
on behalf of any Person engaged in the Business of the Company (other than the Company) solicit, contact, or attempt to solicit or contact any current, former or prospective customer of the Company whom you had contacted within the twenty-four (24) months prior to your last day of employment with the Company or about whom you have any Confidential Information.
|
(iii)
|
encourage or persuade, or attempt to encourage or persuade any (A) customer of the Company, (B) potential customer of the Company during the last twenty-four (24) months of your employment with the Company with which or with whom you knew to be such a potential customer, or (C) prior customer of the Company, in each case, not to do business with the Company or to reduce the amount of business it is doing or might do in the future with or through the Company.
|
(j)
|
Tolling. If you violate any of the terms of the Restrictive Covenant obligations articulated herein, the obligation at issue will run from the first date on which you cease to be in violation of such obligation.
|
(k)
|
Successors and Assigns. The Award Agreement (including this Paragraph 1) shall inure to the benefit of the successors and assigns of the Company. The Company may assign this Award Agreement (including this Paragraph 1), without your consent to, including but not limited to, any of its Subsidiaries or Affiliates or to any successor (whether by merger, purchase, bankruptcy, reorganization or otherwise) to all or substantially all of the equity, assets or businesses of the Company. You may not assign the Award Agreement (or the obligations set forth in this Paragraph 1).
|
2.
|
Interpretation. All determinations regarding the interpretation, construction, enforcement, waiver, or modification of this Award Agreement and/or the Plan shall be made in the Administrator’s sole discretion and shall be final and binding. Determinations made under this Award Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated.
|
3.
|
Conflict. If any of the terms of this Award Agreement in the opinion of the Administrator conflict or are inconsistent with any applicable law or regulation of any governmental agency having jurisdiction, the Administrator reserves the right to modify this Award Agreement to be consistent with applicable laws or regulations.
|
4.
|
Personal Data. You understand and acknowledge that the Company holds certain personal information about you, including but not limited to your name, home address, telephone number, date of birth, social security number, salary, nationality, job title, and details of all Shares awarded, cancelled, vested, unvested, or outstanding (the “personal data”). Certain personal data may also constitute “sensitive personal data” within the meaning of applicable local law. Such data include but are not limited to the information provided above and any changes thereto and other appropriate personal and financial data about you. You hereby provide explicit consent to the Company and any Subsidiary to process any such personal data and sensitive personal data. You also hereby provide explicit consent to the Company and any Subsidiary to transfer any such personal data and sensitive personal data outside the country in which you are employed, and to the United States. The legal persons for whom such personal data are intended are the Company and any third party providing services to the Company in connection with the administration of the Plan.
|
5.
|
Plan Documents. By accepting this award, you acknowledge having received and read this Award Agreement and the Plan, and you consent to receiving information and materials in connection with this Award or any subsequent awards under the Company’s long-term performance plans, including without limitation any prospectuses and plan documents, by any means of electronic delivery available now and/or in the future (including without limitation by e-mail, by Website access, and/or by facsimile), such consent to remain in effect unless and until revoked in writing by you. This Award Agreement and the Plan, which is incorporated herein by reference, constitute the entire agreement between you and the Company regarding the terms and conditions of this Award.
|
6.
|
Jurisdiction; Governing Law. Any action arising out of or related to this Award Agreement or the Plan shall be brought exclusively in the United States District Court for the Eastern District of Pennsylvania, or in any court of general jurisdiction in Allentown, Pennsylvania; you and the Company consent to personal jurisdiction in any such court and waive any objection to the laying of venue of any such suit, action or proceeding in any such court. This Award Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania without reference to its principles of conflict/choice of law. You and the Company also irrevocably and unconditionally consent to the service of any process, pleadings, notices, or other papers with respect thereto. YOU AND THE COMPANY IRREVOCABLY AGREE TO WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS AWARD AGREEMENT.
|
7.
|
Modification; Severability. If any court of competent jurisdiction finds any provision of this Award Agreement, and particularly the covenants set forth in Paragraph 1, or portion thereof, to not be fully enforceable, it is the intention and desire of the parties that the provision be fully enforced to the extent the court finds them enforceable and, if necessary, that the court modify any provisions of this Award Agreement to the extent
|
8.
|
Waiver. The failure of the Company to enforce any terms, provisions or covenants of this Exhibit shall not be construed as a waiver of the same or of the right of the Company to enforce the same. Waiver by the Company of any breach or default by you of any term or provision of the Award Agreement (including these Restrictive Covenants) shall not operate as a waiver of any other breach or default.
|
9.
|
No Contract. None of your FY2019 Restricted Stock Unit Awards, this Award Agreement, nor the Plan constitute a contract of employment; nor do they guarantee your continued employment for any period required for all or any of your Awards to vest or become exercisable.
|
1.
|
Restrictive Covenants.
|
(a)
|
Definitions. For purposes of this Paragraph 1, the following words shall have the following definitions.
|
(i)
|
“Affiliate” of a specified Person shall mean any Person which is under common control with the specified Person, or of which the specified Person is an executive officer, manager, trustee, executor or similar controlling Person.
|
(ii)
|
“Company” shall be deemed to include Air Products and Chemicals, Inc. and the subsidiaries and Affiliates of Air Products and Chemicals, Inc.
|
(iii)
|
“Business of the Company” means the production, manufacturing and distribution of industrial gases, including atmospheric and process gases; the designing and manufacturing of equipment for the production, processing, purification distribution or storage of gases or for natural gas liquefaction; and any other line of business conducted, developed or being developed by the Company during your employment with the Company, in each case, in which you are or were involved during the course of your employment with the Company or about which you possess Confidential Information.
|
(iv)
|
“Confidential Information” means any non-public, proprietary confidential or trade secret information of the Company and/or its customers, including but not limited to, business processes, know-how, practices, methods, plans, research, operations, services, strategies, techniques, formulae, manuals, data, notes, diagrams, customer or vendor information, pricing or cost information, product plans, designs, experimental processes and inventions.
|
(v)
|
“Person” means any natural person, corporation, general partnership, limited partnership, limited liability company or partnership, joint venture, proprietorship or other business organization.
|
(vi)
|
“Provide Services” means to directly or indirectly, own, manage, control, or participate in the ownership, management or control of, or be employed or engaged by, participate in, serve on the board of directors of, consult with, contribute to, hold a security interest in, render services for, give advice to, provide assistance to or be otherwise affiliated or associated with.
|
(vii)
|
“Restricted Area” means any country in which you worked during your employment with the Company, over which you had supervisory responsibility for the Business of the Company while employed by the Company, or with respect to which you have Confidential Information pertaining to the Business of the Company.
|
(b)
|
Acknowledgment.
|
(i)
|
You acknowledge and agree that (A) the Business of the Company is intensely competitive and that your employment with the Company has required you to have access to, and knowledge of, Confidential Information, which is of vital importance to the success of the Business of the Company; (B) the use, disclosure or dissemination of any Confidential Information, except on behalf of the Company, could place the Company at a serious competitive disadvantage and could do serious damage, financial and otherwise, to the Business of the Company; and (C) the Company is engaged in business, and has customers, throughout the world.
|
(ii)
|
You further understand and acknowledge that the Company invests in customer relationships and as a result, has developed and will develop considerable goodwill with and among its customers. You agree that the Restrictive Covenants articulated herein are necessary to protect the Company’s legitimate business interests in its Confidential Information and goodwill, and that the Company would not have provided the good and valuable consideration set forth in this Award Agreement in absence of such restrictions. You further understand and acknowledge that the
|
(c)
|
Confidential Information.
|
(i)
|
You hereby expressly acknowledge and agree that the obligations in this Award Agreement are in addition to, and shall not supersede, the obligations you may have pursuant to other agreements with the Company, including, without limitation, your obligations under your Employee Patent and Confidential Information Agreement that you entered into when you were employed by the Company, which shall continue to apply in accordance with its terms.
|
(ii)
|
You agree that you have and will at all times hereafter, (A) treat all Confidential Information as strictly confidential; and (B) not directly or indirectly disclose, publish, communicate or make available Confidential Information, or allow it to be disclosed, published, communicated, or made available, in whole or part, to any Person who is not authorized by the Company to know such Confidential Information in the furtherance of the Company’s business.
|
(d)
|
Non-Disparagement. You agree not to directly or indirectly make, or cause to be made, any statement, observation or opinion that disparages or impugns the business or reputation of the Company, its products, services, agents or employees.
|
(e)
|
Permitted Disclosures. Pursuant to 18 U.S.C. § 1833(b), you understand that you will not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret of the Company that (i) is made (A) in confidence to a Federal, State, or local government official, either directly or indirectly, or to your attorney and (B) solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. You understand that if you file a lawsuit for retaliation by the Company for reporting a suspected violation of law, you may disclose the trade secret to your attorney and use the trade secret information in the court proceeding if you (I) file any document containing the trade secret under seal, and (II) do not disclose the trade secret, except pursuant to court order. Nothing in this Award Agreement, or any other agreement you have with the Company, is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by such section. Further, nothing in this Award Agreement or any other agreement you have with the Company shall prohibit or restrict you from making any disclosure of information or documents to any governmental agency or legislative body, or any self-regulatory organization, in each case, without advance notice to the Company.
|
(f)
|
Return of Company Property. You represent that upon request from the Company at any time and, without request, upon termination of your employment with the Company for any reason, you will deliver to the Company all memoranda, notes, records, manuals, or other documents, including all electronic or other copies of such materials and all documentation prepared or produced in connection therewith, containing Confidential Information, which is in your possession, custody and control, whether made or compiled by you or furnished to you by virtue of your employment with the Company. You further represent that you will deliver to the Company all vehicles, computers, credit cards, telephones, handheld electronic devices, office equipment and other property furnished to you by virtue of your employment with the Company.
|
(g)
|
Notice. You agree that during your employment with the Company and for two years after your employment with the Company terminates for any reason, you will give the Company ten (10) business days’ written notice of your intention to Provide Services to any other Person that engages in or is preparing to engage in the Business of the Company within the Restricted Area. Such written notice must provide sufficiently detailed information so as to allow the Company to determine if you will be in breach of this Award Agreement if you Provide Services to such other Person.
|
(h)
|
Non-Competition. During your employment by the Company and for two years after your employment with the Company terminates for any reason, you agree that you will not Provide Services to any Person, other than the Company, that engages in or is preparing to engage in the Business of the Company within the Restricted Area, unless (i) such other Person also engages in lines of business that are separate, distinct and divisible from the Business of the Company, (ii) you do not Provide Services, Confidential Information or strategy to the Business of the Company conducted by such other Person, and (iii) you do not attend meetings where the Business of the Company conducted by such other Person is discussed or where you could, even inadvertently, disclose Confidential Information. Your passive ownership of not more than one percent (1%) of the capital stock or other ownership or equity interest, or voting power, in a public company, registered under the Securities Exchange Act of 1934, as amended, shall not be deemed to be a violation of this paragraph.
|
(i)
|
Non-Solicitation; Non-Interference. During your employment by the Company and for two years after your last day of employment with the Company, you also agree that you will not, directly or indirectly without the prior written consent of the Company:
|
(i)
|
encourage, persuade, induce, or attempt to encourage or persuade or induce, any person who is an employee at the grade level of 118 or above, an officer, or a director of the Company, in each case, to terminate such relationship with the Company; or hire or engage, participate in the hiring
|
(ii)
|
on behalf of any Person engaged in the Business of the Company (other than the Company) solicit, contact, or attempt to solicit or contact any current, former or prospective customer of the Company whom you had contacted within the twenty-four (24) months prior to your last day of employment with the Company or about whom you have any Confidential Information.
|
(iii)
|
encourage or persuade, or attempt to encourage or persuade any (A) customer of the Company, (B) potential customer of the Company during the last twenty-four (24) months of your employment with the Company with which or with whom you knew to be such a potential customer, or (C) prior customer of the Company, in each case, not to do business with the Company or to reduce the amount of business it is doing or might do in the future with or through the Company.
|
(j)
|
Tolling. If you violate any of the terms of the Restrictive Covenant obligations articulated herein, the obligation at issue will run from the first date on which you cease to be in violation of such obligation.
|
(k)
|
Successors and Assigns. The Award Agreement (including this Paragraph 1) shall inure to the benefit of the successors and assigns of the Company. The Company may assign this Award Agreement (including this Paragraph 1), without your consent to, including but not limited to, any of its Subsidiaries or Affiliates or to any successor (whether by merger, purchase, bankruptcy, reorganization or otherwise) to all or substantially all of the equity, assets or businesses of the Company. You may not assign the Award Agreement (or the obligations set forth in this Paragraph 1).
|
2.
|
Interpretation. All determinations regarding the interpretation, construction, enforcement, waiver, or modification of this Award Agreement and/or the Plan shall be made in the Administrator’s sole discretion and shall be final and binding. Determinations made under this Award Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated.
|
3.
|
Conflict. If any of the terms of this Award Agreement in the opinion of the Administrator conflict or are inconsistent with any applicable law or regulation of any governmental agency having jurisdiction, the Administrator reserves the right to modify this Award Agreement to be consistent with applicable laws or regulations.
|
4.
|
Personal Data. You understand and acknowledge that the Company holds certain personal information about you, including but not limited to your name, home address,
|
5.
|
Plan Documents. By accepting this award, you acknowledge having received and read this Award Agreement and the Plan, and you consent to receiving information and materials in connection with this Award or any subsequent awards under the Company’s long-term performance plans, including without limitation any prospectuses and plan documents, by any means of electronic delivery available now and/or in the future (including without limitation by e-mail, by Website access, and/or by facsimile), such consent to remain in effect unless and until revoked in writing by you. This Award Agreement and the Plan, which is incorporated herein by reference, constitute the entire agreement between you and the Company regarding the terms and conditions of this Award.
|
6.
|
Jurisdiction; Governing Law. Any action arising out of or related to this Award Agreement or the Plan shall be brought exclusively in the United States District Court for the Eastern District of Pennsylvania, or in any court of general jurisdiction in Allentown, Pennsylvania; you and the Company consent to personal jurisdiction in any such court and waive any objection to the laying of venue of any such suit, action or proceeding in any such court. This Award Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania without reference to its principles of conflict/choice of law. You and the Company also irrevocably and unconditionally consent to the service of any process, pleadings, notices, or other papers with respect thereto. YOU AND THE COMPANY IRREVOCABLY AGREE TO WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS AWARD AGREEMENT.
|
7.
|
Modification; Severability. If any court of competent jurisdiction finds any provision of this Award Agreement, and particularly the covenants set forth in Paragraph 1, or portion thereof, to not be fully enforceable, it is the intention and desire of the parties that the provision be fully enforced to the extent the court finds them enforceable and, if necessary, that the court modify any provisions of this Award Agreement to the extent deemed necessary by the court to render them reasonable and enforceable and that the court enforce them to such extent. To the extent that such provisions cannot be modified,
|
8.
|
Waiver. The failure of the Company to enforce any terms, provisions or covenants of this Exhibit shall not be construed as a waiver of the same or of the right of the Company to enforce the same. Waiver by the Company of any breach or default by you of any term or provision of the Award Agreement (including these Restrictive Covenants) shall not operate as a waiver of any other breach or default.
|
9.
|
No Contract. None of your FY2019 Performance Share Awards, this Award Agreement, nor the Plan constitute a contract of employment; nor do they guarantee your continued employment for any period required for all or any of your Awards to vest or become exercisable.
|
1.
|
Performance Shares Earned. For the avoidance of doubt, capitalized terms that are otherwise not defined in this Attachment IV will have the same definition as in the Award Agreement. The number of Performance Shares earned will be determined in accordance with the following formula:
|
(PERFORMANCE SHARES AWARDED) x (PAYOUT FACTOR) =
(PERFORMANCE SHARES EARNED)
|
2.
|
Payout Factor. The “Payout Factor” is the percentage determined under this Section 2. The Payout Factor is based on the Company’s TSR Percentile Rank among the Peer Group for the Performance Period. The “Initial Payout Factor” is determined in accordance with the following schedule:
|
Company’s TSR
Percentile Rank
|
Initial Payout Factor
|
> 75th %ile
|
200%
|
> 50th %ile
|
100%
|
> 30th %ile
|
30%
|
< 30th %ile
|
0%
|
3.
|
Definitions.
|
Celanese Corp.
|
Illinois Tool Works, Inc.
|
The Chemours Co.
|
Ingersoll-Rand, Plc
|
Danaher Corp.
|
Linde plc.
|
Dover Corp.
|
Olin Corporation
|
Eastman Chemical Co.
|
Parker-Hannifin Corp.
|
Ecolab, Inc.
|
PPG Industries Inc.
|
Huntsman Corp.
|
|
4.
|
TSR Percentile Rank. The TSR Percentile Rank will be determined as follows:
|
1.
|
Restrictive Covenants.
|
(a)
|
Definitions. For purposes of this Paragraph 1, the following words shall have the following definitions.
|
(i)
|
“Affiliate” of a specified Person shall mean any Person which is under common control with the specified Person, or of which the specified Person is an executive officer, manager, trustee, executor or similar controlling Person.
|
(ii)
|
“Company” shall be deemed to include Air Products and Chemicals, Inc. and the subsidiaries and Affiliates of Air Products and Chemicals, Inc.
|
(iii)
|
“Business of the Company” means the production, manufacturing and distribution of industrial gases, including atmospheric and process gases; the designing and manufacturing of equipment for the production, processing, purification distribution or storage of gases or for natural gas liquefaction; and any other line of business conducted, developed or being developed by the Company during your employment with the Company, in each case, in which you are or were involved during the course of your employment with the Company or about which you possess Confidential Information.
|
(iv)
|
“Confidential Information” means any non-public, proprietary confidential or trade secret information of the Company and/or its customers, including but not limited to, business processes, know-how, practices, methods, plans, research, operations, services, strategies, techniques, formulae, manuals, data, notes, diagrams, customer or vendor information, pricing or cost information, product plans, designs, experimental processes and inventions.
|
(v)
|
“Person” means any natural person, corporation, general partnership, limited partnership, limited liability company or partnership, joint venture, proprietorship or other business organization.
|
(vi)
|
“Provide Services” means to directly or indirectly, own, manage, control, or participate in the ownership, management or control of, or be employed or engaged by, participate in, serve on the board of directors of, consult with, contribute to, hold a security interest in, render services for, give advice to, provide assistance to or be otherwise affiliated or associated with.
|
(vii)
|
“Restricted Area” means any country in which you worked during your employment with the Company, over which you had supervisory responsibility for the Business of the Company while employed by the Company, or with respect to which you have Confidential Information pertaining to the Business of the Company.
|
(b)
|
Acknowledgment.
|
(i)
|
You acknowledge and agree that (A) the Business of the Company is intensely competitive and that your employment with the Company has required you to have access to, and knowledge of, Confidential Information, which is of vital importance to the success of the Business of the Company; (B) the use, disclosure or dissemination of any Confidential Information, except on behalf of the Company, could place the Company at a serious competitive disadvantage and could do serious damage, financial and otherwise, to the Business of the Company; and (C) the Company is engaged in business, and has customers, throughout the world.
|
(ii)
|
You further understand and acknowledge that the Company invests in customer relationships and, as a result, has developed and will develop considerable goodwill with and among its customers. You agree that the Restrictive Covenants articulated herein are necessary to protect the Company’s legitimate business interests in its Confidential Information and goodwill, and that the Company would not have provided the good and valuable consideration set forth in this Award Agreement in absence of such restrictions. You further understand and acknowledge that the
|
(c)
|
Confidential Information.
|
(i)
|
You hereby expressly acknowledge and agree that the obligations in this Award Agreement are in addition to, and shall not supersede, the obligations you may have pursuant to other agreements with the Company, including, without limitation, your obligations under your Employee Patent and Confidential Information Agreement that you entered into when you were employed by the Company, which shall continue to apply in accordance with its terms.
|
(ii)
|
You agree that you have and will at all times hereafter, (A) treat all Confidential Information as strictly confidential; and (B) not directly or indirectly disclose, publish, communicate or make available Confidential Information, or allow it to be disclosed, published, communicated, or made available, in whole or part, to any Person who is not authorized by the Company to know such Confidential Information in the furtherance of the Company’s business.
|
(d)
|
Non-Disparagement. You agree not to directly or indirectly make, or cause to be made, any statement, observation or opinion that disparages or impugns the business or reputation of the Company, its products, services, agents or employees.
|
(e)
|
Permitted Disclosures. Pursuant to 18 U.S.C. § 1833(b), you understand that you will not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret of the Company that (i) is made (A) in confidence to a Federal, State, or local government official, either directly or indirectly, or to your attorney and (B) solely for the purpose of reporting or investigating a suspected violation of law; or (ii) is made in a complaint or other document that is filed under seal in a lawsuit or other proceeding. You understand that if you file a lawsuit for retaliation by the Company for reporting a suspected violation of law, you may disclose the trade secret to your attorney and use the trade secret information in the court proceeding if you (I) file any document containing the trade secret under seal, and (II) do not disclose the trade secret, except pursuant to court order. Nothing in this Award Agreement, or any other agreement you have with the Company, is intended to conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade secrets that are expressly allowed by such section. Further, nothing in this Award Agreement or any other agreement you have with the Company shall prohibit or restrict you from making any disclosure of information or documents to any governmental agency or legislative body, or any self-regulatory organization, in each case, without advance notice to the Company.
|
(f)
|
Return of Company Property. You represent that upon request from the Company at any time and, without request, upon termination of your employment with the Company for any reason, you will deliver to the Company all memoranda, notes, records, manuals, or other documents, including all electronic or other copies of such materials and all documentation prepared or produced in connection therewith, containing Confidential Information, which is in your possession, custody and control, whether made or compiled by you or furnished to you by virtue of your employment with the Company. You further represent that you will deliver to the Company all vehicles, computers, credit cards, telephones, handheld electronic devices, office equipment and other property furnished to you by virtue of your employment with the Company.
|
(g)
|
Notice. You agree that during your employment with the Company and for two years after your employment with the Company terminates for any reason, you will give the Company ten (10) business days’ written notice of your intention to Provide Services to any other Person that engages in or is preparing to engage in the Business of the Company within the Restricted Area. Such written notice must provide sufficiently detailed information so as to allow the Company to determine if you will be in breach of this Award Agreement if you Provide Services to such other Person.
|
(h)
|
Non-Competition. During your employment by the Company and for two years after your employment with the Company terminates for any reason, you agree that you will not Provide Services to any Person, other than the Company, that engages in or is preparing to engage in the Business of the Company within the Restricted Area, unless (i) such other Person also engages in lines of business that are separate, distinct and divisible from the Business of the Company, (ii) you do not Provide Services, Confidential Information or strategy to the Business of the Company conducted by such other Person, and (iii) you do not attend meetings where the Business of the Company conducted by such other Person is discussed or where you could, even inadvertently, disclose Confidential Information. Your passive ownership of not more than one percent (1%) of the capital stock or other ownership or equity interest, or voting power, in a public company, registered under the Securities Exchange Act of 1934, as amended, shall not be deemed to be a violation of this paragraph.
|
(i)
|
Non-Solicitation; Non-Interference. During your employment by the Company and for two years after your last day of employment with the Company, you also agree that you will not, directly or indirectly without the prior written consent of the Company:
|
(i)
|
encourage, persuade, induce, or attempt to encourage or persuade or induce, any person who is an employee at the grade level of 118 or above, an officer, or a director of the Company, in each case, to terminate such relationship with the Company; or hire or engage, participate in the hiring
|
(ii)
|
on behalf of any Person engaged in the Business of the Company (other than the Company) solicit, contact, or attempt to solicit or contact any current, former or prospective customer of the Company whom you had contacted within the twenty-four (24) months prior to your last day of employment with the Company or about whom you have any Confidential Information.
|
(iii)
|
encourage or persuade, or attempt to encourage or persuade any (A) customer of the Company, (B) potential customer of the Company during the last twenty-four (24) months of your employment with the Company with which or with whom you knew to be such a potential customer, or (C) prior customer of the Company, in each case, not to do business with the Company or to reduce the amount of business it is doing or might do in the future with or through the Company.
|
(j)
|
Tolling. If you violate any of the terms of the Restrictive Covenant obligations articulated herein, the obligation at issue will run from the first date on which you cease to be in violation of such obligation.
|
(k)
|
Successors and Assigns. The Award Agreement (including this Paragraph 1) shall inure to the benefit of the successors and assigns of the Company. The Company may assign this Award Agreement (including this Paragraph 1), without your consent to, including but not limited to, any of its Subsidiaries or Affiliates or to any successor (whether by merger, purchase, bankruptcy, reorganization or otherwise) to all or substantially all of the equity, assets or businesses of the Company. You may not assign the Award Agreement (or the obligations set forth in this Paragraph 1).
|
2.
|
Interpretation. All determinations regarding the interpretation, construction, enforcement, waiver, or modification of this Award Agreement and/or the Plan shall be made in the Administrator’s sole discretion and shall be final and binding. Determinations made under this Award Agreement and the Plan need not be uniform and may be made selectively among individuals, whether or not such individuals are similarly situated.
|
3.
|
Conflict. If any of the terms of this Award Agreement in the opinion of the Administrator conflict or are inconsistent with any applicable law or regulation of any governmental agency having jurisdiction, the Administrator reserves the right to modify this Award Agreement to be consistent with applicable laws or regulations.
|
4.
|
Personal Data. You understand and acknowledge that the Company holds certain personal information about you, including but not limited to your name, home address,
|
5.
|
Plan Documents. By accepting this award, you acknowledge having received and read this Award Agreement and the Plan, and you consent to receiving information and materials in connection with this Award or any subsequent awards under the Company’s long-term performance plans, including without limitation any prospectuses and plan documents, by any means of electronic delivery available now and/or in the future (including without limitation by e-mail, by Website access, and/or by facsimile), such consent to remain in effect unless and until revoked in writing by you. This Award Agreement and the Plan, which is incorporated herein by reference, constitute the entire agreement between you and the Company regarding the terms and conditions of this Award.
|
6.
|
Jurisdiction; Governing Law. Any action arising out of or related to this Award Agreement or the Plan shall be brought exclusively in the United States District Court for the Eastern District of Pennsylvania, or in any court of general jurisdiction in Allentown, Pennsylvania; you and the Company consent to personal jurisdiction in any such court and waive any objection to the laying of venue of any such suit, action or proceeding in any such court. This Award Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Pennsylvania without reference to its principles of conflict/choice of law. You and the Company also irrevocably and unconditionally consent to the service of any process, pleadings, notices, or other papers with respect thereto. YOU AND THE COMPANY IRREVOCABLY AGREE TO WAIVE TRIAL BY JURY IN ANY ACTION, PROCEEDING, CLAIM, OR COUNTERCLAIM BROUGHT BY OR ON BEHALF OF ANY PARTY RELATED TO OR ARISING OUT OF THIS AWARD AGREEMENT.
|
7.
|
Modification; Severability. If any court of competent jurisdiction finds any provision of this Award Agreement, and particularly the covenants set forth in Paragraph 1, or portion thereof, to not be fully enforceable, it is the intention and desire of the parties that the provision be fully enforced to the extent the court finds them enforceable and, if necessary, that the court modify any provisions of this Award Agreement to the extent deemed necessary by the court to render them reasonable and enforceable and that the court enforce them to such extent. To the extent that such provisions cannot be modified,
|
8.
|
Waiver. The failure of the Company to enforce any terms, provisions or covenants of this Exhibit shall not be construed as a waiver of the same or of the right of the Company to enforce the same. Waiver by the Company of any breach or default by you of any term or provision of the Award Agreement (including these Restrictive Covenants) shall not operate as a waiver of any other breach or default.
|
9.
|
No Contract. Neither the Award, this Award Agreement, nor the Plan constitute a contract of employment; nor do they guarantee your continued employment for any period required for all or any of your Awards to vest or become exercisable.
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1.
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Effective January 1, 2019, Section 2.49 shall be amended to read as follows:
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2.
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In all other respects the Plan shall remain in full force and effect.
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1.
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Effective January 1, 2019, Section 3.08(b) (iii)(B) shall be amended to read as follows:
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2.
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Effective January 1, 2019, Section 3.08(b)(iii)(C) shall be deleted.
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3.
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In all other respects the Plan shall remain in full force and effect.
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/s/ Seifi Ghasemi
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Seifi Ghasemi
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Chairman, President and Chief Executive Officer
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/s/ M. Scott Crocco
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M. Scott Crocco
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Executive Vice President and Chief Financial Officer
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1.
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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2.
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date: 25 January 2019
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/s/ Seifi Ghasemi
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Seifi Ghasemi
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Chairman, President, and Chief Executive Officer
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|
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/s/ M. Scott Crocco
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M. Scott Crocco
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Executive Vice President and Chief Financial Officer
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